Online trade in the business-to-business (B2B) sector has long since arrived. B2B and e-commerce now go hand in hand. One in five retailers generates its revenue through online sales.
The future of B2B e-commerce looks excellent. People's changing shopping behavior is not stopping in the corporate sector. Those who already offer digital shopping options or have set the course for digital today have perfect chances for a successful future.
Regardless of whether you are already active in online commerce in the B2B sector or are just getting started - the potential is great. However, B2B e-commerce does come with some challenges. We'll show you the 5 biggest challenges and what benefits you can derive from online trade with corporate customers.
If you would like to get started in B2B trade, we would be happy to support you. Contact us without any obligation and we will support you in word and deed.
Definition: What is B2B Commerce?
B2B (business-to-business) e-commerce refers to all digital forms of transaction between business customers. A company sells products and services online to another company. The digital solutions used in online trade between companies range from a classic online store and online marketplaces to supplier and procurement platforms.
The potential of B2B e-commerce is huge. Already in 2018, B2B e-commerce sales in Germany amounted to 1.3 trillion euros. Due to advancing digitalization and the COVID-19 pandemic, B2B online retail sales are steadily increasing. According to calculations by IFH Cologne, a quarter of all wholesale sales will be generated online by 2025.
Reading tip: When looking for the appropriate e-commerce platform, you are faced with the question of On-Premise oder Cloud? To make your decision easier, we have taken a close look at both solutions.
Differences in online trade B2B vs. B2C
B2B e-commerce differs significantly from online trade with end consumers (B2C). Online trade at the corporate level usually involves complex goods that require explanation. This entails different structures and processes than in the classic B2C sector. These are the main differences between B2B and B2C e-commerce:
|Customers||✅ Company||✅ Private individuals|
|✅ smaller target group||✅ large target group|
|✅ long-term partnerships||✅ fast moving|
|Shopping carts||✅ Shopping baskets are larger||✅ Shopping cart is smaller|
|✅ Order value is higher||✅ value is usually lower|
|Purchase process||✅ longer communication channels||✅ Short communication channels|
|✅ Frequent interactions||✅ Few interactions|
|Customer Journey||✅ Decision on purchase can drag on for weeks as many decision-makers are passed through||✅ relatively short and linear|
|Prices||✅ individual prices for companies||✅ Same prices for all end customers|
1. The customer
While B2C commerce sells to private individuals and thus to tens of thousands to millions of people, the customers in B2B commerce are companies. The target group in corporate online commerce is thus significantly smaller. Due to the smaller number of suppliers and customers in the B2B sector, partnerships often develop over many years.
2. The baskets
The shopping carts of participants in B2B e-commerce are generally larger. This means that the order values in the B2B sector are also much higher than in the B2C sector. Whereas in the end-customer market, the conclusion of a purchase usually happens quite quickly, more thought is required in B2B e-commerce.
3. The purchase process
Every sales deal involves multiple approvals and numerous stakeholders. The decision-makers are usually not individuals but corporate units (so-called buying centers). The sales cycle thus takes longer, resulting in longer communication paths and more frequent interactions.
4. The Customer Journey
The customer journey for private customers is relatively short and linear. After identifying a need, products are searched for and compared, and finally purchased. In B2B e-commerce, the decision-making process is often long. Both the number of decision-makers and the complexity of the products are reasons for this. The decision can therefore take weeks or even months.
5. The prices
The prices in the private customer business are approximately the same. In B2B e-commerce, on the other hand, different prices have to be managed. While buyer A may negotiate an individual price, buyer B must buy at the list price.
Reading tip: Do you have a Shopify store? Switching to Shopify Plus can be worthwhile. In this article, we show you what you should look out for.
Challenges in B2B e-commerce
Those who rely on B2C solutions in B2B e-commerce will quickly reach their limits. Often, the functional scope of B2C e-commerce platforms is not sufficient for B2B merchants. Custom workflows become necessary, which poses major challenges for many companies.
1. Ensure individuality
Long-term partnerships with customers often result in individual agreements on conditions regarding prices or delivery. A B2B platform must map these specific conditions in order to be accepted. Speaking of prices: It is true that purchase on account is still the most popular payment method in B2B online commerce. However, the acceptance of other payment options such as PayPal or credit card is increasing. With increasing transactions via mobile devices, transactions via wallets (Google Pay or Apple Pay) are also becoming interesting for B2B e-commerce.
Reading tip: The right payment options are crucial to your success. In this post, we'll show you what payment options Shopify offers.
2. Map different workflows
Another challenge in B2B commerce is the involvement of multiple decision makers. The larger the company, the more people are likely to be involved in the purchasing decision. Depending on the department and person, there are different budget responsibilities and approval rights. It may be that a department can fill a shopping cart, but must pass the cart to an authorized person to process the order. These approval processes and workflows must be mapped by the B2B solution.
3. Linking of different systems
One of the biggest challenges for B2B companies in e-commerce is integration into existing IT infrastructure. Different customer requirements, product portfolios, data and processes make a system architectural challenge out of a B2B platform. Data and information must be exchanged between systems. Linking all digital solutions, from enterprise resource planning to order management and accounting, to logistics and marketing, requires some technical know-how. A powerful integration of the B2B online store into the existing infrastructure and the smooth connection of services such as payment and shipping are the be-all and end-all of a successful B2B e-commerce strategy.
4. Increase attention and acceptance
A beautiful, new online store usually doesn't sell anything on its own. So it is necessary to build marketing measures into the B2B e-commerce strategy. The first and perhaps most difficult step is to advertise to existing customers. Often, long-standing relationships have been established and a direct sales force with its own contacts has been set up. To increase acceptance of the new e-commerce solution, benefits must be communicated clearly and transparently. Then, the company's core markets can be targeted and potential customers can be won over to B2B e-commerce.
5. Optimize processes
At the end of the day, people are still buying, even on the business customer side. What is already commonplace in the B2C sector is increasingly expected by B2B customers as well, namely smooth and fast order processing. For B2B retailers, it is essential to constantly improve their own processes. This includes simplifying processes, automating workflows and transparent communication.
Reading tip: A so-called Product Information Management (PIM for short) is the central source of information on all your products. In this article, we show you why such a system is worthwhile.
Advantages of B2B trade
You see: Building an e-commerce solution for online trade in a corporate context requires know-how and perseverance. However, the hard work will certainly pay off, because B2B e-commerce offers a number of advantages.
1. Market development - exploiting new potential
B2B e-commerce enables companies to tap into markets and target groups that were previously inaccessible. Be it due to geographical distances or low margins in face-to-face sales. With an e-commerce solution, business can be internationalized as well as pure online buyers (self-service) can be reached.
2. Sales growth - increase sales
Opening up new markets and target groups naturally also holds the potential to increase sales. With a smooth and efficient buying process, customers may buy more often. In B2B e-commerce, related products (so-called cross-selling) or higher-value products (so-called up-selling) can also be operated more effectively.
Reading tip: With your store, you want one thing above all: to sell products. To make this even more successful, we have written down tips for conversion rate optimization!
3. Building relationships - retaining customers for the long term
With digital solutions for retailers, you not only make it easier for customers to find and connect with suppliers. With a smooth process and additional services, you can also retain the customer in the long term. Keeping an existing customer is often much cheaper than acquiring new ones.
4. Increasing efficiency - optimization through data
Thanks to digital solutions, you can not only acquire and retain new customers. You also gain valuable insights into buying behavior. With automatic data collection and evaluation, you can analyze usage behavior and personalize products and services. Direct feedback from customers also helps you improve products. As a result, you can make faster and better decisions and improve your own processes by linking all internal systems.
5. Cost savings - better allocation of resources
Lengthy, paper-based processes cost money and time. By automating your processes, you can save costs with online B2B commerce. Not only your accounting department will thank you, but also your employees. With the elimination of time-consuming processes, they can devote themselves to more important tasks.
Shopify B2B - How it works
The Shopify B2B section includes many features that enable B2B sales in your shop without having to use third-party apps or other intermediate solutions. For example, you can create custom price lists or currencies and payment terms, but also connect diverse buyers and locations. You can also create a customised theme for your B2B trade. With these functions, you can add B2B to your B2C shop and thus create a mixed shop or create an extension shop for B2B customers.
Shopify B2B is only convertible with a Shopify Plus plan so far.
B2B Examples: Business-to-business commerce in practice
B2B can be implemented not only for physical products, but also for digital ones. Some of our customers have already successfully implemented B2B in Shopify. We'll show you which ones they are.
Selecta is the largest supplier of food from vending machines. They are now present on Shopify Plus, where they offer business or wholesale customers the opportunity to purchase the well-known products from the vending machines.
Everyone has probably heard of Babbel. The well-known provider of language courses has been working on the basis of Shopify Plus for a long time. With the extension "Babbel for Business", Babbel has also been offering language courses in the B2B area for some time. Companies can register here and give their employees access to the courses.
Another example of Shopify B2B is Bego. The leading manufacturer of dental prostheses and implants relies on Shopify Plus. The online shop is designed purely for B2B business and supplies dentists and dental practices throughout Germany.
B2B e-commerce presents a number of challenges. Nevertheless, the effort of building digital solutions in enterprise commerce can be worthwhile. In the future, more and more purchases in the B2B sector will take place online. Those who take the right steps today to ensure a smooth buying process via online platforms will have a successful future ahead of them. Those who already offer e-commerce solutions can leverage the full potential of online trade in the B2B sector by automating and optimizing their processes.
Latori has already implemented numerous national and international online stores with Shopify Plus. We stand by you as a reliable partner for the opening and optimization of your B2B store with advice and support.
Frequently asked questions about B2B e-commerce and B2B trade
What is B2B e-commerce?
B2B commerce, unlike B2C, involves selling to businesses rather than end customers.
How do I generate customers in B2B?
The most important thing here is to choose the right touchpoints through which potential customers get in touch with you or become aware of you. These can be trade fairs or events, for example.
How does B2B marketing work?
Since the target group for B2B e-commerce is rather small, contact above all is an important factor. For this reason, you should invest effort and time in customer care. When planning the marketing strategy, it should also be kept in mind that companies - unlike end customers - think primarily in economic terms.
What are the differences between B2B and B2C?
B2B and B2C differ in various aspects, including the target group, shopping baskets, prices, the buying process or the customer journey.
What is a B2B online shop?
In a B2B online shop, products or services are sold to businesses. With the Shopify Plus plan, this can be easily realised in Shopify - without any third-party apps or other intermediate solutions.
What is a B2B example?
An example of B2B commerce is Selecta. They offer business or wholesale customers the opportunity to purchase goods from their well-known vending machines. Another well-known example is Babbel. They also offer companies language courses for their employees and thus cover B2B.